Can you afford to be a stay-at-home parent?

Money

Written by:

 

Maintaining a career while being a mom has always been a huge part of my identity. Being the youngest of four, I just thought it was normal for my mom to be home with me. When she went back to work as a special ed teacher, I felt special to share her with other school children.

Growing up, most of my friends’ mothers worked at least part-time. As an adult, most of the moms I know work as well. Now that I’m the mother of multiple children, I see that no decision can be taken for granted. There’s a lot of thought and energy around the decision of whether to stay home with the kids or not!

According to the Pew Research Center, about 18% of American parents take care of their children full-time. This percent is virtually the same as it was in 1989, although these days more dads are staying home; about a quarter of stay-at-home parents today are fathers.

In these times of COVID-19, the job description of “parent” has changed drastically—especially for those attempting to get work done with kids running around the house, without formal school or childcare. Even as schools reopen, the new waves of the pandemic threaten the stability of our best-laid childcare plans.

Among couples in which both parents work, women provide about 70% of the childcare during working hours, and experts warn that the pandemic could have a very serious impact on working parents for years to come, especially working mothers.

The situation has changed for stay-at-home parents, too. It’s one thing to stay home with the kids in normal times . . . and quite another when you can’t even go to play groups or parks.

Of course, most of us aren’t (and shouldn’t be) making a decision about our future based on vague concepts of gender and workplace equality. COVID-19 or not, we need to consider the reality of our specific day-to-day lives, support systems and financial picture. The decision of whether to stay home with the kids or return to work can’t be made through logic alone.

Still, we’ve created a clear framework to provide financial clarity and help you be confident you’ve made the best choice for your family.

Start With What Matters to You…

Balancing the demands of working, parenting, relationships and life can be draining. In some cases, it might be less burdensome to focus on parenting or working rather than both; in other cases, you might find it isolating to quit a job that’s meaningful to you.

Start with these key questions:

  1. Some people have strong feelings about sending their kids to daycare or leaving them with a nanny. How do you feel about someone else taking care of your child(ren)?
  2. Is childcare even an option for you right now with COVID-19? In what form? Center? Full-time nanny? Part-time sitter?
  3. How will your family handle an unexpected, large emergency expense if it’s down one income?
  4. Do you love your job? Does your career give you a sense of identity?
  5. Do you want to spend all day taking care of your children?
  6. Are there other factors that might impact your decision, such as a child with special needs?

One mom we spoke to, Isabel, went back to work for seven months after maternity leave. She tried returning full-time for a month, but then she went part-time before finally stopping altogether.

“The biggest factor in our decision was our happiness as a family,” she says. “I felt really burned out trying to be the perfect employee and perfect mother/wife.”

In other cases, circumstances may change even the best-laid plans. For Kate, having an extremely premature baby weighed heavily in her choice to leave her finance job.

“I always believed I would go back. I agonized over the stigma after having such a ‘big’ career,” she says. “Then one day I realized that it doesn’t matter what others think.”

Eventually, she started her own business and structures her time so that she can better balance work and family.

On the other hand, if you wake up excited to go to work, that’s not something to be minimized. Being happier, healthier and more fulfilled will help you as a parent and enable you to model positive attitudes toward work for your children. Before having kids, Arielle assumed she’d want to stay home.

“But when I was pregnant, I realized I loved working and did not want to give it up,” she says.

 

…Then Weigh Your Finances

Not everyone has the luxury of quitting their job—and not everyone has the luxury to continue working if childcare costs more than what they’re bringing home in their paycheck.

Here’s an “equation” to help you understand what staying at home might mean for your family’s finances.

Step 1: Calculate your baseline spending

List out all of your regular monthly household expenses, including:

  • Housing

  • Utilities

  • Groceries

  • Eating out and entertainment

  • Clothes

  • Household expenses

  • Transportation expenses, including gas and car payments

  • Exercise and wellness

  • Health insurance and prescriptions

Step 2: Calculate work-specific expenses

Now, note expenses that might be unique or different when you’re working as opposed to when you’re not:

  • (Expected) child care costs
  • Additional costs of commuting
  • Take-out and other on-the-go food you buy specifically because you’re busy and working

Step 3: Account for any extra stay-at-home expenses

Think about whether there would be any additional expenses if you didn’t work. For example, if your family is on your health insurance through your job, would costs go up if you quit? Could your spouse’s job provide coverage, or would you have to get insurance on the open market? Roughly how much would that come out to?

Also consider any fringe benefits provided through your job that you might miss if you were to leave, such as flexible spending accounts or bonuses.

Massachusetts CPA Rachael Hylan helps clients review which benefits they’d lose if they left the workforce, ranging from 401(ks) to health and dental, disability insurance and so on.

“We review the impact of the tax cost of their spouse’s earnings once they transition to a single-income household,” she says. “This helps provide a better comparison of the true cost of daycare versus lost wages.”

If your situation is complex, you might consider consulting with a professional to make sure you’re understanding the full picture.

Step 4: Do the math for your partner, too

If you and your partner would both consider being the stay-at-home parent, try totaling these two scenarios (working and non-working) for each of you. For example, would the health care situation be very different depending on which of you were to quit working? Does one of you have an expensive commute while the other works from home?

Step 5: Understand your current income 

Total your monthly household income from all sources (remember to subtract taxes). How much does your family bring in when both you and your spouse are working? What would be the total if either of you stopped working?

Step 6: Map out your ‘working scenario’

Take your family’s current total income and subtract your total expenses if you were working, including childcare. Let’s call this “A.”

Note that for many people, childcare costs match or even exceed what they make at work. Chelsea, a Connecticut mother of 16-month-old twins, says, “When we saw the cost of full-time daycare in our area, it made sense for me to stay home, at least for a little while.”

The equation might also change if and when you have additional children, as expenses will go up accordingly: “I often think I would’ve continued working if we had a singleton,” Chelsea says. Having two infants in full-time care doubled the cost and would have eaten up so much of her paycheck that it wasn’t worth it.

If your current working scenario means juggling work from home with all the responsibilities of caring for your children, factor that into the equation, too. Does it make logistical sense to trade off with a partner? Can you work a flexible schedule? If working scenario “A” depends on reliable childcare, you may need to sketch out a new plan to account for possible pandemic closures.

Step 7: Map out your ‘non-working scenario’

Now, to compare, take the total household income if you were to quit. Subtract your household expenses in the stay-at-home scenario (i.e. your expenses without childcare, but maybe higher health insurance). Let’s call this “B.”

Step 8: Analyze the numbers

If the number you get for A is positive, but B is a negative number, you cannot afford to stay home right now, at least without some serious changes to your budget.

Are both numbers in the black? These figures represent the difference between how much you make and how much you spend. Essentially, it’s how much you’d be able to save in each scenario. (Here are some money-saving tips from personal finance bloggers.)

According to one rule of thumb, you should ideally be saving 15% of your income. Particularly if you or your spouse are considering quitting, you might consider that a floor since you’ll likely want some ongoing cushion against unexpected expenses.

You will probably also want to take stock of your emergency fund before making a final decision about whether to stay in the workforce. Many experts recommend savings of about six months’ living expenses. Especially if you’re fully reliant on just one spouse’s income, you might choose to save at least this much or even more before quitting. It’s also worth noting that during a pandemic and/or recession, it can take longer to secure new employment.

If you’re confident that both your “A” and “B” scenarios are sufficient for your family financially, you can decide whether or not to stay in the workforce solely based on what would make you and your family happiest.

Remember That Nothing’s Permanent

Both being home and keeping a career on track are valid goals. Misty Lynch, a Certified Financial Planner (CFP) in Massachusetts says, “I like to remind people they can change their minds.”

Brittany has been a stay-at-home mom since her son was born: “We made the decision mostly because that was what I had always imagined doing, but also my income was not significant enough to go back to work,” she says.

Yet after staying home for almost two years, she’s feeling ready to return to the workforce in the next couple years, at least part-time.

 “It is important to find something that is fulfilling, which I didn’t realize I would miss,” she said.

If you want more time at home but don’t want to leave your job entirely (or leave a gaping hole on your resume), you might find creative compromises, too.

For example, Jessi, a mom of two, worked out an agreement with her husband. He reduced his hours to 80% for six to eight months after their first child, and she did the same for more than a year after their second, to reduce the amount they’d have to pay daycare.

“I stayed in the workforce because, quite frankly, I couldn’t see myself staying home full-time,” she says.

A hybrid approach can also help avoid a drastic hit to your lifetime earning potential. Studies have shown that in the developed world, women experience a post-baby income drop that they never fully recover from.

Of course, not all people leave the workforce by choice. There are layoffs, illnesses and other unexpected, sometimes forced changes. Having a financial plan and a savings cushion will help your family stay afloat regardless of what life brings. Approaching this decision in advance allows you time to not just save money, but also to take some time to dream about what your ideal life looks like.

Related:

This article originally appeared on MeetFabric.com and was syndicated by MediaFeed.org.

 

Fabric exists to help young families master their money. Our articles abide by strict editorial standards.

More from MediaFeed:

18 family trips to take before your kids turn 18

 

Among the most popular high school graduation gifts is Dr. Seuss’ “Oh the Places You’ll Go.” But if there were a foreword to that book, it would aptly be titled “Oh the Places You’ve Been.”

 

Before your kids start taking spring break trips with their college friends, or, down the line, embark on family vacations of their own, now is the time to travel with them and share the wonders of the world.

 

Need convincing? Studies show that family vacations can be good for your children’s emotional growth and even help them get better grades.

 

Here are 18 trips to consider taking with your kids before they turn 18.

 

eli_asenova/istockphoto

 

Camping is a quintessential family activity. And while s’mores and campfire stories sound great in theory, setting up camp can be a lot of work after a long day of traveling or if your family isn’t really the “camping type.”

 

Enter “no-tent” camping. You can rent tipis at a state park in Northern Colorado, for example, or even sleep in a treehouse you rented on Airbnb.

 

monkeybusinessimages/istockphoto

 

Skip SeaWorld and trade waiting in lines for a much more authentic vacation where you can witness majestic sea creatures in their natural habitats.

 

Terranea Resort, A Destination Hotel, for example, is perched on the craggy coast of the Pacific Ocean, with telescopes along the bluffs so you can expertly scout the waters. Sea lions will play a friendly game of peek-a-boo with you while you’re out on a kayak. Or the resort’s casual lunch spot, Nelson’s, has a bell that guests ring when they spot a whale passing by. Both California Blue and Pacific Gray whales migrate in the waters just 50 yards offshore and can be viewed year-round. The resort also extends a program that lets guests participate in an official whale count.

The property also has a falconry program, and your kids can learn about the birds of prey and even meet a falcon. The falcons came to the resort in 2009 as an eco-friendly way to rid the property of pesky seagulls. And speaking of all things birds, when you’re empty nesters, you can come back here and enjoy the adults-only pool and spend more time in the spa, which offers panoramic views of the ocean.

 

Doescher / iStock

 

The National Parks are coming off their 100th birthday celebration. They’re America’s greatest playgrounds, especially for the intrepid types.

 

Your kids can sandboard in the Great Sand Dunes in southern Colorado, watch the wild horses gallop between Virginia and Maryland in Assateague Island or take a river hike through the narrows in Utah’s Zion National Park.

 

WerksMedia/istockphoto

 

Being buried in sand and building sandcastles are childhood musts. A good place to do just that? The white sand beaches of Panama City Beach in Florida.

 

Here, the sunsets are so spectacular they get their own nightly ritual at Schooner’s, a beachfront restaurant that does a cannon blast right as the sun drops.

 

Or, you can escape to St. Andrew’s State Park, where you can cast your line off of Tiller Pier and fish for Spanish mackerel, red fish, flounder and sea trout from the Gulf of Mexico. You can also follow the park’s “Gator Lake Trail” to a viewing area where, from a safe distance, you can spot alligators and wading birds.

 

pexels

 

Meow Wolf in Santa Fe, New Mexico (and Las Vegas and Denver) is a one-of-a-kind experience, and when you visit the attraction, it feels like you’re stepping onto the set of a sci-fi film.

 

Take your teenagers there and they’ll remember just how cool you are. The exhibit took over a former bowling alley and its main benefactor is George R.R. Martin, the author of “Game of Thrones.”

 

Once inside, you’ll become captivated by the House of Eternal Returns, which comes with a fascinating storyline. The Cliff Notes version goes like this: The family that once inhabited it has disappeared and you’re left to search for clues. (Totally cool to dig through their mail and open up their refrigerator, which may actually be a portal that travels to another dimension.)

 

Plus, Meow Wolf has free arcade games.

 

Meow Wolf

 

Canoes, bonfires and swimming are a trifecta of quintessential summer activities. If you’re scouting for a great place to take a lake vacation, consider Elkhart Lake in Wisconsin.

 

You can rent canoes and sailboats, as well as giant hydrobikes to churn through the water. The lake casts a gorgeous green color because of its unique clay bottom.

 

Plus, you can satiate your need for speed with a day trip to Road America, where visitors can race Go-Karts that will track your speed and even tell you where you ranked among your group.

 

Elkhartlake.com

 

A cruise is an amazing way to locomote around the world because you’ll get to stop and see so many different destinations during your vacation. Plus, it’s a great way to gather up the whole family (grandma and grandpa included!) for a fun vacation since there are so many itineraries to choose from.

 

If you’re cruising with kids, Princess Cruises offers excursions that partner with Discovery Channel’s top shows through a Discovery at Sea program. Among the voyages your crew (i.e., family) can take are ones to Alaska, the British Isles, the Panama Canal, the Caribbean and more.

cruise

 

The cruise has Youth Centers and Teen Lounges with themes that are age-appropriate (Think: a treehouse for kids ages 3 to 7 or a surf-themed beach house for teens). Plus, there are kid activities on the cruises, like MythBusters science experiments and theme days inspired by Shark Week and Animal Planet.

 

Rawpixel / iStock

 

Modern art districts are thrilling not just for their museums and exhibits, but the cool street art and murals around every corner too.

 

If you’re an art lover, consider putting Norfolk, Virginia, on your must-visit list. Sure, you may know the city for its naval presence — you can’t miss Nauticus, where the USS Wisconsin is docked. (It’s one of the largest battleships the U.S. Navy ever built.) But, the city also has a booming arts scene, which helped it earn a spot on Travel & Leisure’s best places to visit in 2017.

 

The Chrysler Museum of Art offers free, daily general admission. After you’re done touring it, you can bop around the NEON (New Energy of Norfolk) district where you take a family portrait next to color-splashed murals, watch glass-blowing demonstrations or stop in the eclectic shops.

 

Epantha / iStock

 

You might come to Cusco for the history, excited to explore the Sacred Valley of the Incas. But Awana Kancha, a llama, alpaca and vicuña farm, is just a short drive from the city, too, and makes for a fun addition to the itinerary. The animals will be eagerly awaiting your arrival because they’ll be expecting you to feed them handfuls of grass.

 

You’ll also get to watch some textile weaving demonstrations. A cool place to stay while you’re there? The JW Marriott El Convento Cusco, which is a 16th-century convent that was turned into a hotel. The lobby is even frequented by alpacas and llamas!

 

Juni Samos / iStock

 

Colombia’s capital city is filled with graffiti, which provides a lens through which to understand the country’s history.

 

The W Hotel Bogotá actually has a “graffiti concierge” who will lead you on an interactive tour of the urban art scene, with the first stop in the hotel lobby where a bright mural reveals an ancient love story.

 

Other worthwhile tourist must-dos include the Museo del Oro, which contains the world’s largest collection of gold, and taking a cable car up to Monserrate mountain, which offers up a panoramic view of the city from 10,000 feet above sea level.

 

 

Markpittimages / iStock

 

Traveling along the Mighty Mississippi can be quite a varied adventure as you traverse through bluffs, rolling green hills and then swamplands. How’s that for a geography lesson?

 

A good place to start your trip is where the Mississippi River begins its journey: Lake Itasca in Minnesota. There, your kids can traipse across the stones of the river’s headwaters. They can also visit the Headwaters Science Museum in Bemidji, which features more than 70 hands-on exhibits.

 

John Brueske /iStock

 

How cool would it be to travel the same paths as dinosaurs?

 

In Black Hills, South Dakota, you can visit the Dinosaur Park where dinos from the Late Jurassic and Early Cretaceous periods once roamed. Life-sized concrete replicas will give you a scope of just how huge these prehistoric reptiles were. Then, visit some live creatures at the Reptile Gardens, which Guinness World Records has dubbed the “world’s largest reptile zoo.”

 

DINphotogallery / iStock

 

If you’re traveling with kids, Mardi Gras in New Orleans might be a little too rowdy. But you can still laissez les bons temps rouler(translation: let the good times roll). Head to Mobile, Alabama, which claims to be the birthplace of Mardi Gras in America, having started the celebration in 1703.

Mobile

 

The port city’s family-friendly Mardi Gras celebrations come with parades, colorful floats and lots of Moon Pies being tossed to the crowd. You can also visit the Mobile Carnival Museum, where the spectacular gowns and robes are on display.

 

Nodar Chernishev / istockphoto

 

If you’re looking to blend your love of travel with volunteering, there are plenty of opportunities.

 

NatureCorps, for example, organizes trips that can range in duration, starting with three-day trips. Volunteers taking part in an eight-day trip to Hawaii Volcanoes National Park, for example, will join an effort to save endangered and rare flora, but will also have time to explore the waterfalls and lush rainforests.

 

Or, if your kids are ages 4 and up, you can sign up for a myriad of volunteer projects abroad.

 

Ken McCurdy / istockphoto

 

Sure, the national parks got plenty of well-deserved attention during their 100th birthday celebration. But there are some amazing state parks that can rival the national parks.

 

Take, for instance, Niagara Falls Sate Park, the oldest state park in America, established in 1885. Aside from witnessing the majestic falls, you can take a guided tour through an underground man-made hydraulic raceway or visit Power Vista, which has 50 interactive exhibits that teach about electricity.

 

Serjio74/istockphoto

 

You’ve got plenty of options for this kind of trip.

You can visit any of the 15 presidential libraries across the United States. Or you can do a unique tour—like visiting Lyndon B. Johnson’s ranch, which became known as the “Texas White House” because of the numerous meetings and press conferences he held there.

 

Families can also go on presidential tours in Virginia, including of George Washington’s hometown in Fredericksburg or Lincoln’s Walk by a segway in Richmond.

 

Arnold Newman, White House Press Office/Wikimedia Commons

 

Psst, trips to Europe right now are super-cheap—especially if you want to head to Paris, Rome, Barcelona, Madrid, Prague and Reykjavik.

 

Flights to those European cities are down by 20 to 30 percent year over year, according to data from Kayak, a fare aggregator. If you’re on a budget, the best time to travel is summer, especially May.

 

DepositPhotos.com

 

Call it trail-glazing! Butler County in Ohio has a new “donut trail”that weaves together nine local, family-owned businesses. From maple bacon to Fruity Pebbles donuts, you can satiate your sweet tooth here.

 

Some other noteworthy trails worth exploring with your tastebuds: the Indiana Hoosier Pie trail, the salsa trail in Arizona and the South Carolina barbecue trail.

 

This article originally appeared on Simplemost and was syndicated by MediaFeed.org.

 

sandsun

 

 

JTBOB888 / istockphoto

 

Featured Image Credit: Povozniuk/istockphoto.

AlertMe